More Homeowners Cashing in on Their New Housing Wealth

Homeowners are opening their favorite piggy bank again — their homes. As home values rise faster than expected, that increased homeowner wealth suddenly seems more enticing. It’s showing up in big remodeling growth and higher profits for retailers like Home Depot and Lowe’s, but it also serves as a warning sign. Ever since the epic housing crash at the end of the last decade, homeowners have been extremely conservative with their home equity. Even those who had money in their homes kept it there, fearing another downturn in prices. Now, as millions of borrowers come up from underwater on their home loans and many more see their home values jump sizably on paper, borrowing more is back in favor. Home equity lines of credit, known as HELOCs and often serving as second loans, allow homeowners…(read more)